For Further Information:
The Patterson Law Firm, LLC
Sarah Frye
Phone: 312.223.1699
August 19, 2011

FOR IMMEDIATE
RELEASE:

An Insurance Coverage Win
for Corporate Directors

CHICAGO, IL – The Appellate Court affirms
that an important insurance coverage win for corporate directors is
now final. One of the key inducements offered by companies to
persons they want to serve as directors is directors and officers
insurance (D&O coverage). Yet the insurance policies purchased
for that purpose often contain exclusions that negate the
coverage.
Two common exclusions are the insured versus insured and the
bankruptcy exclusion. The bankruptcy exclusion, in particular,
would negate coverage in the circumstance when the directors need
it most: when the company has failed and the creditors or other
shareholders are looking for someone to blame.

Recently, the Illinois Appellate Court affirmed a ruling of the
trial court that neither exclusion could apply to deny coverage to
directors facing lawsuits by a bankruptcy trustee. Yessenow v.
Executive Risk Indemnity, Inc. was issued June 30, 2011. No motion
to reconsider or appeal this decision was made and the decision is
now final. The bankruptcy exclusion was deemed unenforceable by
section 541(c) of the Bankruptcy Code.

“The decision is well-reasoned and significant to directors
everywhere who need insurance coverage, but face these common
exclusions with insurance companies who deny coverage,” Thomas
Patterson of The Patterson Law Firm, LLC and the attorney for the
directors said.“I believe that many directors and perhaps some
lawyers read these policy exclusions but have not read the
Bankruptcy Code and the cases and neglect to claim coverage that is
rightfully theirs.”

The Patterson Law Firm, LLC is dedicated to helping businesses,
professionals and entrepreneurs properly handle business lawsuits
while facilitating effective business practices. The law firm
practice areas include breach of contract, intellectual property
and insurance coverage.